In the Spotlight: NRF’s Revised Report on Organized Retail Crime Impact

The National Retail Federation (NRF), the largest retail trade group in the United States, recently revised a report that claimed organized retail crime was responsible for almost half of the industry’s overall inventory loss due to theft. The correction, made on December 1, came after an analysis by Retail Dive, an online news site covering retail trends, identified errors in the data presented in the initial report.

The NRF had originally released the report in collaboration with K2, a financial crimes risk management firm, stating that out of the $94.51 billion attributed to industry shrink, nearly half was due to organized retail crime. However, the NRF’s Vice President of Asset Protection and Retail Operations, David Johnston, acknowledged the mistake, attributing it to an inaccurate inference made by a K2 analyst who linked data from the 2022 NRF security survey to a $45 billion figure mentioned in U.S. Senate testimony by Ben Dugan of the Coalition of Law Enforcement and Retail (CLEAR).

The revised report no longer provides an estimate of the financial impact of organized retail crime or references to CLEAR. Johnston clarified the oversight, admitting, “It was an inaccurate inference. We missed it.”

The issue of organized retail crime has gained attention in recent years, particularly with high-profile incidents like smash-and-grab thefts and flash mob robberies. While some retailers, such as Target, have cited theft as a threat to safety and closed stores in response, a November report by the nonpartisan Council on Criminal Justice presented a different perspective. The report, examining 24 major U.S. cities, indicated a 16% increase in shoplifting incidents compared to the first half of 2019, though excluding New York City, reported incidents actually decreased by 7%.

Ernesto Lopez of the Council of Criminal Justice emphasized the need for more comprehensive data to understand the extent and nature of the shoplifting problem. The NRF acknowledged the challenges faced by the retail industry and law enforcement in gathering accurate and agreed-upon data to measure theft incidents nationwide while maintaining its stance on the seriousness of organized retail crime as a widespread issue affecting retailers of all sizes and communities across the country.